154 A. 123 | Pa. | 1931
Appellant, a widow, employed Loney as an agent to dispose of her real estate. He procured for her a loan on a mortgage from a building and loan association. After she executed the mortgage, he took it to the association and received in return a check payable to her order. He then forged her endorsement on the check, secured the money from the drawee bank, and misappropriated it. To continue to conceal his fraud, he induced appellant to convey the property to a clerk in his office on the representation that he had a purchaser for it. *76 Later, Loney becoming involved with other clients, Eglins, his clerk transferred the property to such clients' nominee in part liquidation of a defalcation to them. Thereafter his mother, without knowledge of her son's fraud, gave her notes and other obligations to such clients' nominee for the property in reduction of Loney's defalcation. She afterwards conveyed the property, her son acting as agent, to Fulleborns for $6,500. They also had no knowledge of her son's fraud. This sum was distributed among the various persons claiming as lien creditors or as the mother's creditors or others. Part of it went into Loney's hands. A bill was filed by appellant against all persons through whom title to the property had passed, down to and including the Fulleborns. The bill prayed for a reconveyance of the property or an accounting of the purchase price from Fulleborns, with a decree declaring all debts created on account of the property void as to her. The court below dismissed the bill.
It is contended by appellant that Fulleborns and all those who dealt with Loney were affected with knowledge of his fraud. In Hertzler v. Nissly,
On the question of the distribution of this purchase money we will take up the loan from the association. The mere possession by an agent of notes or other securities evidencing an indebtedness, although a fact to be considered, does not, of itself, confer authority on such agent to receive payment therefor or money thereon: 2 C. J. 623, paragraph 260 (5) (a). So an agent's authority to receive the money advanced on a mortgage is not to be implied from the fact that the agent has the mortgage in his possession. But if the agent has negotiable or other instruments payable to bearer, duly endorsed, or assigned, there is an implied authority for the agent to receive the proceeds: Ibid. Where an agent receives from a mortgagee an assignment of a mortgage to be delivered to the assignee bank to whom he had negotiated its sale, possession and delivery would be sufficient color of authority for the bank to pay the agent the money due on the assignment: Weir v. Washington Trust Co.,
Whether appellant may recover from the association the money unlawfully paid to her agent through the medium of the forged endorsement, we do not decide, but there is no doubt so far as this record shows that she may recover from the bank for a conversion: Louisville, etc., R. R. Co. v. Bank of Pensacola,
As to the other claims that have been made, they arose through various changes of ownership from appellant down to the Fulleborns, the last purchasers. The agent's mother and the Fulleborns paid actual consideration for the property and the claims arose through these transactions. Payment to the Eglins, the owners of the claims, and to others, was on account of these liabilities. They did not represent antecedent debts. Much as we regret the unfortunate circumstances, we are unable to help the appellant in her claim against the defendants named.
Decree affirmed; costs to be paid by appellant. *80